A true solution is an integrated bundle of products and related services that creates value for the customer that is more than the sum of its parts. Such a solution meets four criteria:
It is co-created with customers.
It is tailored to each customer’s requirements.
It delivers superior service on the customer’s terms, including rapid response, ready access, and clear accountability from the supplier.
Some of the risk perceived by customers is absorbed by suppliers through performance- or risk-based contracts or commitments.
It’s easy simply to label a bundle that enables one-stop shopping as a “solution.” But such solutions are not valuable innovations. Competitors can copy them easily, and so they do not typically result in growth. Growth comes from solutions based on an outside-in insight into how to solve a customer’s problems. True solutions help customers succeed on their terms. One excellent example of this type of innovation is GE’s and Rolls-Royce’s “power by the hour” programs, which allow customers to pay a fixed fee per hour of usage of an aircraft engine, which gives customers much greater cost certainty.